JONATHAN COHN AUGUST 26, 2010
Did the Recovery Act create jobs? And did it create enough of them? That's the question Democrats and Republicans have been debating in Washington. And that's the question likely to be on the minds of voters this fall.
But in a new story for Time, Michael Grunwald suggests maybe that's not the most important question after all:
The battle over the Recovery Act's short-term rescue has obscured its more enduring mission: a long-term push to change the country. It was about jobs, sure, but also about fighting oil addiction and global warming, transforming health care and education, and building a competitive 21st century economy. Some Republicans have called it an under-the-radar scramble to advance Obama's agenda--and they've got a point.
Yes, the stimulus has cut taxes for 95% of working Americans, bailed out every state, hustled record amounts of unemployment benefits and other aid to struggling families and funded more than 100,000 projects to upgrade roads, subways, schools, airports, military bases and much more. But in the words of Vice President Joe Biden, Obama's effusive Recovery Act point man, "Now the fun stuff starts!" The "fun stuff," about one-sixth of the total cost, is an all-out effort to exploit the crisis to make green energy, green building and green transportation real; launch green manufacturing industries; computerize a pen-and-paper health system; promote data-driven school reforms; and ramp up the research of the future.
Mike provides a detailed look at some of these investments, including an initiative that provides seed money for firms that build batteries for electric cars like the Chevy Volt. He also anticipates and addresses the usual criticisms--that government is lousy at picking winners and losers in the economy, and that it is bound to waste a ton of money:
The stimulus really is starting to change Washington--and not just the buildings. Every contract and lobbying contact is posted at Recovery.gov, with quarterly data detailing where the money went. A Recovery Board was created to scrutinize every dollar, with help from every major agency's independent watchdog. And Biden has promised state and local officials answers to all stimulus questions within 24 hours. It's a test-drive for a new approach to government: more transparent, more focused on results than compliance, not just bigger but better. Biden himself always saw the Recovery Act as a test--not only of the new Administration but of federal spending itself. He knew high-profile screwups could be fatal, stoking antigovernment anger about bureaucrats and two-car funerals. So he spends hours checking in, buttering up and banging heads to keep the stimulus on track, harassing Cabinet secretaries, governors and mayors about unspent broadband funds, weatherization delays and fishy projects. He has blocked some 260 skate parks, picnic tables and highway beautifications that flunked his what-would-your-mom-think test. ...
So far, despite furor over cash it supposedly funneled to contraception (deleted from the bill) and phantom congressional districts (simply typos), the earmark-free Recovery Act has produced surprisingly few scandals. Prosecutors are investigating a few fraud allegations, and critics have found some goofy expenditures, like $51,500 for water-safety-mascot costumes or a $50,000 arts grant to a kinky-film house. But those are minor warts, given that unprecedented scrutiny. ...
The Recovery Act's deeper reform has been its focus on intense competition for grants instead of everybody-wins formulas, forcing public officials to consider not only whether applicants have submitted the required traffic studies and small-business hiring plans but also whether their projects make sense. Already staffed by top technologists from MIT, Duke and Intel, ARPA-E [the administration's in-house venture capital arm] recruited 4,500 outside experts to winnow 3,700 applications down to 37 first-round grants. "We've taken the best and brightest from the tech world and created a venture fund--except we're looking for returns for the country," Majumdar says. These change agents didn't uproot their lives to fill out forms in triplicate and shovel money by formula. They want to reinvent the economy, not just stimulate it. Sadoway, the MIT battery scientist, is tired of reporting how many jobs he's created in his lab: "If this works, I'll create a million jobs!"
Skeptics may roll their eyes at this, but they shouldn't. Mike, whom I know well, is a famously skeptical journalist who has won a slew of awards for his tough coverage of government agencies. (Just ask the Army Corps of Engineers.) If he is enthusiastic about the Recovery Act, then you should be, too.